Bpi Employees Union – Metro Manila v. Bank Of The Philippine Islands
BPI Employees Union - Metro Manila and Zenaida Uy v. Bank of the Philippine Islands, G.R. No. 178699, September 21, 2011
- Labor Law
- Procedural (Remedial Law)
- illegal dismissal
- backwages
- computation of backwages
- CBA benefits
- execution of labor judgment
- writ of execution
- certiorari under Rule 65
- TRO and mootness
- attorney's fees
- teller's functional allowance
- vacation and sick leave conversion
- interest
I. Facts of the Case
BPI teller Zenaida Uy was terminated by Bank of the Philippine Islands (BPI) and later found illegally dismissed, with awards including reinstatement and full backwages “including all other benefits under the CBA.” After finality of the Supreme Court’s March 31, 2005 Decision, Uy and the union sought execution and computed backwages using current wage/benefit levels and CBA increases during the entire period, which BPI challenged. The Supreme Court ultimately resolved whether the backwages and related monetary awards during execution should include only the wage base at the time of dismissal (and only CBA benefits proven to have been received then), and it also addressed the propriety of BPI’s Rule 65 certiorari and the effect of the CA’s TRO.
1995-12-14
Uy’s services as a bank teller in BPI’s Escolta Branch were terminated for gross disrespect/discourtesy towards an officer, insubordination, and absence without leave.
Uy, together with the BPI Employees Union-Metro Manila, filed a case for illegal dismissal.
1997-12-31
The Voluntary Arbitrator rendered a Decision finding Uy’s dismissal illegal and ordered BPI to immediately reinstate Uy and to pay full back wages, including all other benefits under the CBA, and attorney’s fees.
1998-10-28
The Court of Appeals affirmed the Voluntary Arbitrator’s ruling with modification: it ordered separation pay instead of reinstatement and limited backwages to three years instead of full backwages.
2005-03-31
The Supreme Court modified the CA Decision, directing BPI to pay backwages from the time of illegal dismissal until actual reinstatement and ordering Uy’s reinstatement to her former position (or a substantially equivalent one) without loss of seniority rights and other benefits.
2005-12-06
After the March 31, 2005 Decision became final, the Voluntary Arbitrator issued an Order on execution, agreeing that full back wages included wage and benefit increases (including new benefits granted during the dismissal period) but excluding uniform allowance, anniversary bonus, and Omega watch for lack of basis; it computed backwages totaling ₱3,897,197.89 and issued a writ of execution and notice of garnishment.
2005-12-12
The writ of execution and notice of garnishment were implemented/issued in connection with the Voluntary Arbitrator’s December 6, 2005 Order.
BPI filed with the Court of Appeals a Petition for certiorari under Rule 65 with an urgent motion for TRO or writ of preliminary injunction, alleging grave abuse because the Voluntary Arbitrator’s computation allegedly varied the final and executory March 31, 2005 Supreme Court Decision; the CA issued a TRO restraining implementation of the December 6, 2005 Order and the writ of execution.
2006-08-01
Uy was reinstated in BPI’s payroll on August 1, 2006, rendering moot the TRO aspect that had restrained reinstatement.
2006-05-24
The Court of Appeals ruled that BPI’s resort to certiorari was proper, upheld the legal basis for the award of CBA benefits and attorney’s fees, but found error in the Voluntary Arbitrator’s computation of back wages using the current rate and in deleting dental allowance because its grant was delayed.
2007-07-04
The CA issued an Amended Decision: it held that the March 31, 2005 Supreme Court ruling did not reinstate the Voluntary Arbitrator’s December 31, 1997 award of full back wages including CBA benefits; it recomputed back wages using Uy’s basic salary at dismissal plus regular allowances at the time of dismissal, deleted certain CBA-related items for lack of sufficient proof, affirmed attorney’s fees, and treated the reinstatement as effectively restrained by the TRO.
2007-09-03
The Supreme Court consolidated the petitions: G.R. No. 178699 (filed by Uy and the union) and G.R. No. 178735 (filed by BPI).
2011-09-21
The Supreme Court partially granted both petitions and ordered the Voluntary Arbitrator to recompute back wages using a base figure of Uy’s salary rate at dismissal plus only the regular allowances at dismissal, granted teller’s functional allowance and holiday pay, upheld attorney’s fees (10% of the total award), imposed 12% interest per annum from finality of the March 31, 2005 Decision until full payment, and deleted the award for monetary conversion of vacation and sick leave.
II. Issues
Whether the March 31, 2005 Decision in G.R. No. 137863 reinstated the Voluntary Arbitrator’s December 31, 1997 award of full back wages including all benefits under the Collective Bargaining Agreement (CBA).
Whether the Court of Appeals erred in deleting or disregarding CBA benefits and other increases when computing Uy’s back wages during execution.
Whether BPI’s resort to certiorari under Rule 65 to assail the Voluntary Arbitrator’s December 6, 2005 Order of execution was proper.
Whether the CA’s temporary restraining order (TRO) effectively restrained the reinstatement aspect of the Supreme Court’s final and executory March 31, 2005 Decision.
Whether Uy was entitled to attorney’s fees included in the computation of awards during execution proceedings.
Whether Uy was entitled to the teller’s functional allowance in the recomputation of back wages.
Whether Uy was entitled to the cash conversion of her vacation and sick leave.
III. Ruling
Whether the March 31, 2005 Decision in G.R. No. 137863 reinstated the Voluntary Arbitrator’s December 31, 1997 award of full back wages including all benefits under the Collective Bargaining Agreement (CBA).
The March 31, 2005 Supreme Court Decision did not reinstate the Voluntary Arbitrator’s December 31, 1997 award of full back wages including all CBA benefits.
How the Court reasoned
- The Court examined the March 31, 2005 dispositive portion ordering backwages from illegal dismissal until actual reinstatement and ordering reinstatement, and it compared it with the Voluntary Arbitrator’s earlier award that included full back wages and CBA benefits.
- The Court agreed with the CA’s observation that the March 31, 2005 discussion of back wages did not include interim salary increases and CBA benefits in the manner asserted by Uy/Union.
- Because the March 31, 2005 Decision modified the earlier awards, the Voluntary Arbitrator’s execution should follow the Supreme Court’s specific direction on how back wages were to be computed, not the earlier full-backwages-with-all-benefits framework.
“The March 31, 2005 Decision of this Court in G.R. No. 137863 did not reinstate the December 31, 1997 Decision of the Voluntary Arbitrator which ordered the payment of full back wages including all benefits under the CBA.”
Rule applied
Doctrine on finality/execution of judgments; backwages computation using base salary and regular allowances at the time of dismissal
Whether the Court of Appeals erred in deleting or disregarding CBA benefits and other increases when computing Uy’s back wages during execution.
Backwages should be recomputed using Uy’s salary rate at the time of dismissal plus only the regular allowances received at that time; interim wage/benefit increases under the CBA are not automatically included, and unproven CBA benefits must be excluded.
How the Court reasoned
- The Court reiterated the rule that the base figure in computing back wages is the employee’s basic salary plus regular allowances and benefits received at the time of dismissal, unqualified by wage and benefit increases granted in the interim.
- Applying the rule, the Court treated the Voluntary Arbitrator’s and the CA’s approaches that either used current rates broadly or disregarded the proper base figure as requiring correction.
- The Court accepted the CA’s general approach of excluding CBA items not proven to have been received at the time of dismissal, because execution must reflect what the employee was entitled to at that time under the CBA/recorded entitlements.
Rule applied
Established doctrine on the base figure in computing backwages (basic salary plus regular allowances/benefits received at dismissal); principles on execution consistent with final judgments and proof of entitlement to specific CBA benefits
Whether BPI’s resort to certiorari under Rule 65 to assail the Voluntary Arbitrator’s December 6, 2005 Order of execution was proper.
BPI’s resort to certiorari under Rule 65 was proper to assail the Voluntary Arbitrator’s execution order for grave abuse of discretion.
How the Court reasoned
- The Court addressed whether certiorari was the proper remedy to challenge the execution order of the Voluntary Arbitrator.
- It held that BPI’s certiorari under Rule 65 complied with the requisites for invoking the extraordinary remedy because the execution order allegedly went beyond or varied the final and executory Supreme Court Decision.
- It also relied on the procedural treatment of certiorari in contexts where an inferior tribunal allegedly acted with grave abuse in execution.
“_BPI's resort to certiorari under Rule 65 of the Rules of Court is proper._”
Rule applied
Section 1, Rule 41 of the Rules of Court (as discussed in the case); Rule 65 of the Rules of Court; Eastern Shipping Lines, Inc. v. Court of Appeals
Whether the CA’s temporary restraining order (TRO) effectively restrained the reinstatement aspect of the Supreme Court’s final and executory March 31, 2005 Decision.
The reinstatement-restraining effect of the CA’s TRO became moot when Uy was actually reinstated in BPI’s payroll on August 1, 2006.
How the Court reasoned
- The Court recognized that the TRO had been used to restrain implementation of the aspects of the Voluntary Arbitrator’s order relating to reinstatement.
- However, Uy’s subsequent reinstatement on August 1, 2006 meant that the reinstatement-related controversy no longer presented a live issue.
- Because reinstatement already occurred, the Court treated the TRO’s effect on reinstatement as moot and no longer determinative.
Rule applied
Mootness doctrine in judicial proceedings (the issue becomes academic once the act sought to be restrained is already done)
Whether Uy was entitled to attorney’s fees included in the computation of awards during execution proceedings.
Uy was entitled to attorney’s fees in the awards during execution, in line with the prior award upheld by the CA and consistent with the Supreme Court’s disposition.
How the Court reasoned
- The Court evaluated attorney’s fees as part of the monetary consequences of illegal dismissal already adjudicated in earlier stages.
- It affirmed that attorney’s fees were proper and should be included in the recomputation consistent with what had been finally upheld.
- In the final disposition, the Court specified attorney’s fees as 10% of the total award.
Rule applied
Labor jurisprudence on attorney’s fees in illegal dismissal cases and consistent award in the final decisions (including the specific percentage applied on recomputation in the decision)
Whether Uy was entitled to the teller’s functional allowance in the recomputation of back wages.
Uy was entitled to the teller’s functional allowance.
How the Court reasoned
- The Court resolved the issue of whether teller’s functional allowance should be recognized in the recomputation of back wages.
- It ruled that Uy is entitled to teller’s functional allowance as part of the appropriate allowances connected to her teller position.
- The final disposition expressly included teller’s functional allowance in the recomputation.
“_Uy is entitled to teller's functional allowance but not to vacation and sick leave cash conversion._”
Rule applied
CBA benefit entitlement as part of backwages/allowances that were proven or properly found to be due (and consistent with the Court’s recomputation instructions)
Whether Uy was entitled to the cash conversion of her vacation and sick leave.
Uy was not entitled to cash conversion of her vacation and sick leave.
How the Court reasoned
- The Court considered the claim for cash conversion of vacation and sick leave as part of the recomputed monetary awards.
- It determined that such conversion should be deleted from the execution award.
- The final disposition specifically deleted the award for monetary conversion of vacation and sick leave.
Rule applied
Evidence/proof requirement for monetary claims in labor execution; limitation on conversion of leave credits as monetary awards in the execution context (as applied in the decision)
Doctrines
The base figure in computing the award of back wages to an illegally dismissed employee is the employee's basic salary plus regular allowances and benefits received at the time of dismissal, unqualified by any wage and benefit increases granted in the interim.
Final Disposition
WHEREFORE, the petitions are PARTIALLY GRANTED. The Voluntary Arbitrator is DIRECTED to recompute Uy’s backwages using as base figure Uy’s salary rate at the time of dismissal (₱10,895.00) plus ONLY the regular allowances at the time of dismissal, with the inclusion of teller’s functional allowance and holiday pay, and attorney’s fees equivalent to ten percent (10%) of the total award. Interest of twelve percent (12%) per annum shall be imposed from the finality of the March 31, 2005 Decision until full payment. The award for monetary conversion of vacation and sick leave is DELETED. SO ORDERED.
Notes
The Supreme Court treated the TRO issues on reinstatement as moot because Uy was reinstated in BPI’s payroll on August 1, 2006.